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I. Overview

Bosnia and Herzegovina’s system of government has reached breaking point and the country’s path to European Union (EU) membership is blocked. The constitution requires that the posts in two key institutions, the three-member presidency and the parliamentary House of Peoples, be equally divided among Bosniaks, Croats and Serbs. The European Court of Human Rights (ECtHR) ruled in 2009 this violates the European Convention on Human Rights (ECHR) by restricting others’ access. The European court’s ruling has exposed long-buried contradictions in Bosnia’s constitutional architecture, which have become more acute since the 31 May 2012 collapse of the government coalition. Bosnian politicians need to reform their constitution but reopening the Dayton Agreement will require more than a quick fix. The EU should not make implementing the ECtHR decision a prerequisite for a credible membership application if it seeks thorough comprehensive reform to put the country on a firm footing.

Bosnia’s failure to implement the ECtHR’s landmark judgment on the Sejdić-Finci case baffles observers. Discrimination against minorities such as Jews and Roma is repugnant. Yet more than two and a half years later, despite strong international pressure and a concerted push to find a solution in spring 2012, Bosnian leaders have made no progress in executing it. Even sympathetic observers wonder why the country persists in its “racist” constitution. The Council of Europe warns that neither it nor the EU would consider the 2014 elections for Bosnia’s parliament legitimate without the necessary constitutional amendments.

Yet almost nothing about the Sejdić-Finci case is as it seems. Implementing the judgment will not necessarily improve the situation of minorities, whose marginalisation is due more to political culture than to the impugned constitutional provisions. The dispute is not driven by discrimination which all BiH parties agree must be eliminated. It is about whether, and how, to preserve the rights of Bosnia’s constituent peoples, especially those of the Croats who are the smallest group. Their position is likely to get a new boost when Croatia joins the EU in 2013.

Though the ECtHR case is technical, it raises fundamental questions about Bosnia’s constitutional architecture and has opened dangerous and important issues buried since the end of the war in 1995. In a stinging dissent, Judge Giovanni Bonello condemned the court’s judgment and warned of the dangers of challenging the status quo. Local leaders echo the warning. Bosnia suffers from unresolved issues similar to those which sparked Yugoslavia’s collapse, and a botched set of amendments could make keeping the country together much harder. At the same time, more delay in implementing the court’s judgment means more delay in progress toward the EU, one of the only points on which all Bosnia’s constituencies agree.

Tension between the two aspects of Bosnian federalism – the division into two territorial entities (the Federation of Bosnia and Herzegovina and the Republika Srpska), and three ethnic communities known as constituent peoples (the Bosniaks, Serbs and Croats) – has been growing for a decade. It is no longer sustainable. As Crisis Group described in its reports over the past two years, state institutions are under attack and there is a crisis of governance in the federation and the Republika Srpska. Institutions at all levels are highly inefficient and politicians ignore difficult policy choices and seem immune to domestic or international pressure.

It took fourteen months to form a state government after the October 2010 elections; this fragile coalition broke down less than six months later, on 31 May 2012. A new constellation of parties is trying to assert control, but its former partners in state and federal government are holding on to their positions and the prospects are unclear. What attention they have given to implementing the ECtHR decision has focused on a solution that cements party leaders’ already extensive hold on power. In Bosnia the government and its politicians are not only unable to resolve the problems; they have become a key problem themselves.

There is a popular assumption among Bosnia’s European friends that implementing the European court’s decision and changing its constitution will go some way in improving governance. But there are no quick fixes. It will mean reopening the Dayton Peace Agreement which ended the 1992-1995 war, re-balancing the compromises made in that agreement, and embarking on a comprehensive constitutional reform. Though a return to violence remains unlikely, these issues are highly emotional and risk extending political paralysis and leading to state failure. Bosnia’s leaders believe the EU requires only a technical fix, even if it leaves the country even less governable. Ultimately, the decisions taken will decide whether Bosnia survives to move toward Europe or begins a process of disintegration that will not end peacefully. To avoid this grim prospect:

Bosnia’s political leadership should refocus on constitutional reform, including the execution of the European court’s decision. It should adopt measures that: clarify whether and how elected and appointed officials are responsible to specific groups, all citizens, or those who voted them into office; allow voters rather than mid-level officials to choose national leaders; give Croats an effective means of influencing state policy; provide room for those who identify as citizens rather than in ethnic terms to have a voice; and avoid overly complex rules prone to obstruction.

EU states should lift their conditioning of Bosnia’s candidacy on implementation of the court ruling. Comprehensive constitutional reform should be the end goal of membership talks, not its precondition.

This briefing explores the challenge posed to Bosnia’s constitutional framework, its key institutions and the constituent people concept by the Sejdić-Finci case. It is the first in a two-part series as Crisis Group plans to elaborate on the options for constitutional reform, from minimalist to maximalist, in a report to be published early in 2013.

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Executive Summary

Bosnia and Herzegovina (BiH, or Bosnia) poses little risk of deadly conflict, but after billions of dollars in foreign aid and intrusive international administration and despite a supportive European neighbourhood, it is slowly spiralling toward disintegration. Its three communities’ conflicting goals and interests are a permanent source of crisis, exacerbated by a constitution that meets no group’s needs. The political elite enjoys mastery over all government levels and much of the economy, with no practical way for voters to dislodge it. The European Union (EU) imposes tasks BiH cannot fulfil. A countrywide popular uprising torched government buildings and demanded urgent reforms in February 2014, but possible solutions are not politically feasible; those that might be politically feasible seem unlikely to work. Bosnia’s leaders, with international support, must begin an urgent search for a new constitutional foundation.

The international project to rebuild Bosnia has had success: war’s physical scars are largely gone, and the country is peaceful. The political agonies, however, show the intervention’s limits. Years of well-intentioned reforms, imposed or urged, have left a governing structure leaders circumvent, ignore or despise. May’s floods left scores dead and thousands homeless, exposing the price of poor governance. With growing frequency, Bosnians ask the questions that preceded the 1992-1995 war: shall it be one country, two, or even three; if one country, shall it have one, two or three constituent entities, and how shall it be governed?

The heart of the problem is in Annex 4 to the Dayton Peace Agreement, known as the constitution (and in several changes imposed by courts and international officials). It defines BiH as a state of two entities, in effect but not explicitly federal, but also the state of three constituent peoples (Bosniaks, Croats, Serbs), and yet, simultaneously, of all citizens. A suffocating layer of ethnic quotas has been added, providing sinecures for officials increasingly remote from the communities they represent. The tensions created by constitutional schizophrenia are pushing BiH to the breaking point. A new design is needed: a normal federation, territorially defined, without a special role for constituent peoples, but responsive to the interests of its three communities and the rights of all citizens.

The state administration’s need to reform is made acute by a 2009 decision of the European Court of Human Rights (ECtHR) that in effect requires BiH to change the ethnicity-based way it chooses its chief executive and part of its legislature. Existing proposals try to squeeze the constituent peoples into an ostensibly ethnicity-blind structure on top of which a complicated network of indirect elections would allow party leaders to choose the executive with as little democratic input as possible. The EU and the outside world support this tinkering with Dayton to satisfy the decision, though such proposals have manifestly failed. Bosnians need to rebuild their political structure from the bottom up.

There is no consensus on where to start, but Bosnia may have to break from its political system based on constituent peoples and their rights. Crisis Group has not reached this conclusion lightly. It reflects long experience and observation that no one has been able to frame a broadly attractive vision on the existing flawed basis. With stresses and frustrations accumulating in all communities, Bosnia must conceive new foundations to survive. Agreement may take years and much experimentation and debate, but the search should begin.

BiH is home to three political communities: those primarily loyal to the Bosnian state, usually but not always Bosniaks; those loyal to Republika Srpska (RS), usually Serbs; and those desirous of Croat self-government, usually Croats. Giving the Croats what they want, their own entity to make a three-entity Bosnia, is absolutely rejected by Bosniaks. Building virtual representative units for the three communities, possibly with new emphasis on municipalities as basic building blocks, is intellectually plausible but requires a leap of faith few seem ready to take. A purely civic state is inconceivable to Serbs and Croats.

Neither leaders nor civil society have deeply explored alternatives to three constituent peoples in two entities; any consensus would take time. Nevertheless, the goal should be clear. The head of state should reflect Bosnia’s diversity, something a collective does better than an individual. The same body could be the executive government. Some decisions should require consensus, others a majority. All three communities should be represented, not necessarily in equal numbers. There should be no ethnic quotas; representation should reflect self-defined regions and all their voters. Poorly performing, unnecessary state agencies and ministries should be slimmed or abolished, with powers reverting to the entities; but the state would need new ministries and agencies required for EU membership. The ten cantons in the larger of BiH’s two entities, the Federation (FBiH), are an underperforming, superfluous layer. They could be abolished, their powers divided between the municipalities and the entity government.

Political culture is part of the problem; an informal “Sextet” of party leaders in effect controls government and much of the economy. A multi-ethnic coalition persists, election to election, with only minor adjustments. Membership is earned by winning opaque intra-party competitions in which voters have little say. Change in this system can only come from within: Bosnians should join parties and participate in genuine leadership contests. Sextet power is further buttressed by control of hiring, investment and commercial decisions at state-owned firms, a situation that chokes private investment and growth.

Bosnia is unimaginable without the work of international officials who did much to shape political institutions and implement peace, but the international community has become more obstacle than help. BiH is trapped in a cycle of poorly thought-out, internationally-imposed tasks designed to show leaders’ readiness to take responsibility but that put that moment forever out of reach. The only way to encourage leaders to take responsibility is to treat the country normally, without extraneous tests or High Representatives. The EU could signal a new start by stating it will receive a membership application – the first of many steps on the long accession road. It should then be an engaged, not over-didactic partner in Bosnia’s search for a way to disentangle the constitutional knot.